Federal Direct Loan Consolidation allows borrowers to combine existing Federal education loans into one new loan. The interest rate for a Direct Consolidation Loan is the weighted average of the interest rates on the loans being consolidated (as of the date of the application) - this rate is fixed for the life of the loan and cannot exceed 8.25 percent.
To qualify, borrowers must have at least one Federal Direct Loan or Federal Family Education Loan (FFEL) that is in grace, repayment, deferment or default status. Loans that are in an in-school status cannot be included in a Direct Consolidation Loan. Additional eligibility requirements can be found at Direct Loan Consolidation Borrower Services.
Private student loans are not eligible for Federal Direct Loan Consolidation - contact your private lender to discuss your private loan consolidation options.
Consolidation can offer a variety of benefits, such as:
- One monthly payment to one lender
- Flexible repayment options
- No minimum or maximum loan amounts
- No fees
- Varied deferment options
- Possible reduced montly payments
To apply online or print a paper application, visit Direct Loan Consolidation Borrower Services. Applications can also be submitted over the phone by calling 1-800-557-7392.